April 23 (Bloomberg) -- President George W. Bush urged Congress to agree on new spending for the war on terrorism and asked lawmakers to restrain other government outlays to avoid swelling budget deficits that harm the U.S. economy.

``Taxpayer dollars must be spent wisely, or not spent at all,'' Bush said today in his weekly radio address.

For the U.S. military operating in Iraq, Afghanistan and elsewhere, ``we must give them all the resources they need to protect us from the threats of determined enemies and to prevail in the war on terror,'' Bush said.

In other parts of the budget, ``spending discipline requires difficult choices,'' he said.

The U.S. Senate on April 21 approved $81.3 billion in additional spending in 2005, mostly for the wars in Iraq and Afghanistan and slightly less than the $81.4 billion the House approved last month. Bush originally requested $81.9 billion.

House members refused to fund a $592 million White House request to build a new embassy in Iraq. The Senate package doesn't include a measure approved by the House that would tighten immigration rules. The discrepancy sets up a debate when the two chambers craft a final bill to be signed into law.

``I urge Congress to come together to resolve their remaining differences, and send me a bill quickly,'' Bush said. ``This funding will help provide the weapons, ammunition, spare parts and equipment that our troops need to do their job.''

Spending Restraint

The funding pushes military costs for the two wars to more than $100 billion for fiscal year 2005, which ends Sept. 30. The money is the fourth supplemental request outside the regular budget for Iraq and Afghanistan. It would bring emergency spending approved since 2003 to about $280 billion.

The Bush administration projects government spending will exceed receipts by a record $427 billion in the current fiscal year, which ends Sept. 30. The most recent estimate from the Congressional Budget Office is for a deficit of $394 billion. The previous record was $412 billion in fiscal 2004.

Earlier this week, Federal Reserve Chairman Alan Greenspan told Congress that ``unless that trend is reversed, at some point these deficits would cause the economy to stagnate or worse.'' He urged lawmakers to bring back spending restraint guidelines, called pay-as-you-go rules, that helped the government budget post surpluses in the late 1990s.

In his radio address, Bush echoed that sentiment.

``Sustaining America's prosperity requires restraining the spending appetite of the federal government,'' Bush said. ``Every government program was created with good intentions, but not all are matching good intentions with good results.''

Falling Deficit

Under Bush's $2.57 trillion budget, submitted in February, the deficit would shrink to $390 billion next year, and fall to $207 billion in fiscal 2010. That compares with four years of budget surpluses, from 1998 to 2001. The Bush budget contemplates a return to pay-go rules for spending, but not for tax reductions.

``The savings in my budget are critical in helping us to keep our economy growing and creating jobs,'' he said. ``Members of Congress need to come together and send me a budget that funds our priorities, ensures that taxes stay low and keeps us on track to cut the deficit in half by 2009.''

Bush is spending the weekend at his ranch in Crawford, Texas, were he hosts a meeting Monday with Saudi Arabia's Crown Prince Abdullah that will include a discussion about oil prices that this week rose 9.7 percent to $55.39 a barrel.

To contact the reporters on this story: Brendan Murray in Waco, Texas at brmurray@bloomberg.net

Last Updated: April 23, 2005 10:06 EDT